President Obama addresses problems with Obamacare. Will proposal of extending the ACA’s grandfather clause help people whose policies were cancelled?

At a press conference at the White House on November 14, 2013, President Obama proposed several fixes for people whose health insurance policies were cancelled or may be in danger of cancellation. Obama said he is “not happy” and “deeply concerned” about the “rough” rollout of the government healthcare website and other problems caused by the Affordable Care Act.

Despite the website’s problems, Obama said more than 1 million people have applied on the open marketplace. Those numbers are far lower than expected, and the president again reiterated that his administration is working “24/7” to fix the website’s problems.

But far more controversial in the last week are the many people—as many as 15 million—whose health insurance policies were cancelled by their insurance providers. During the debate around the ACA and repeatedly during his re-election campaign, Obama promised that people who liked their current health insurance policies could keep them. Yet a mere 6 weeks after the launch of the ACA’s open marketplaces, insurers have cancelled policies considered inadequate under the ACA’s new standards.

The president said that the ACA’s grandfather clause was specifically implemented to protect old policies, yet many policies were changed or failed to offer basic coverages and were subsequently cancelled. Health policy standards under the ACA must cover basics like prescription drugs and doctor visits. But the law also mandates coverage for maternity and newborn care, substance abuse care, pediatric care, and other things, even for people who have no need for those services.

Will Extending the Grandfather Clause—with Strings Attached—Fix the Problems with Obamacare?

The president proposed extending the grandfather clause to include all plans pre-2011 plus all plans that have been changed or were purchased since the ACA’s passage, including plans that have been cancelled. Obama admitted that his proposal won’t help everyone who lost insurance coverage, but he wants those people to be able to re-enroll in plans similar to the ones they lost. Alas, for insurers, there’s a catch.

Obama’s proposal includes two restrictions for insurers: they must inform people of their plan’s limitations, and also that they may find better and cheaper plans on the open marketplace.

For these proposals to work, insurers must play ball and state insurance commissioners must decide which cancelled plans can be reinstated. Those are big ifs. For example, insurance companies have already set next year’s premiums based on long-held assumptions about the Affordable Care Act. Now, all that work has been tossed out the window for another year, throwing insurance companies for a loop. How will they react?

Stay Tuned and Grab Some Popcorn: The ACA Could Be Made or Broken in the Next Few Months

No doubt, the Affordable Care Act is a complex law, and with it come complex problems and sometimes painful adjustments.

EINSURANCE can answer all your questions about the Affordable Care Act and how the new law might affect you. Visit our website today.